shutterstock_526341823Entrepreneurs often spend hundreds, if not thousands, of hours thinking about and planning for a new business. If they are wise, they also go through the formal exercise of developing a business plan, which can produce several important benefits:

1. A business plan will be an essential part of any request for financing. A well-prepared plan improves your chances of getting the funds you need.

2. The plan can guide your policies and actions over a number of years as you establish your new business.

3. The process of preparing the plan will enable you to focus on issues that are essential for the future success of your business.

What the plan should include

A formal business plan should be quite detailed. Here’s a suggested outline for what it should include:

  • Business identification
    Company
    History and milestones
  • Purpose
    Mission
    Goals
    Objectives
  • Description of the business
    Company’s products and services
    Major customers
  • Market analysis
    Market environment
    Competitive analysis, including competitors
    Risks
  • Location
    Facilities and offices
    Leases or real estate owned
  • Management
    Key employees
    Background
    Roles
  • Personnel

  • Financial information
    Income statements, historical and projected
    Balance sheets, historical and projected
    Cash flow analysis

Supporting data

As you develop your business plan, remember that statements should be supported with data whenever possible in order to add credibility. Using charts and graphs to present the data is also recommended.

Well worth the effort
The preparation of a full-blown and high-quality formal business plan can be an arduous task. However, the process of preparing the plan will put you in a better position to make daily decisions once your enterprise is under way. The document will be useful when you are seeking financing, when you need to explain the business to potential key employees, and someday when you go to sell the business you worked so hard to create.

This news is provided as a service to you by Marlin Business Services Corp., a nationwide leader in commercial lending solutions for the U.S. small business sector. Marlin’s equipment financing and loan programs are available directly and through third-party vendor programs, including manufacturers, distributors, independent dealers and brokers, to deliver financing and working capital that help build your success.